President Donald Trump said he was ready to impose tariffs on all $500 billion of imported goods from China, remarks that sent the U.S. stock market and dollar retreating and threatened to escalate a trade clash with the Asian giant.
"We`re down a tremendous amount," Trump said in an interview about trade imbalances with China on CNBC broadcast on Friday. "I`m ready to go to 500."
His remarks worried investors already grappling with the impact of a strengthening dollar on corporate results, and key stock indexes on Wall Street dropped at the open on Friday.
Around $505 billion of Chinese goods came into the United States in 2017, leading to a trade deficit of nearly $376 billion, U.S. government data shows.
The magnitude of the imbalance has continued into 2018, with Chinese imports totaling $205 billion in the first five months of the year and the deficit reaching $152 billion.
Trump is taking a more aggressive, protectionist posture on trade than his recent predecessors, sparking retaliatory measures from countries around the world and igniting disputes on multiple fronts. Earlier this month, the United States imposed tariffs on $34 billion of Chinese imports and China promptly levied taxes on the same value of U.S. products.
After the interview, Trump reiterated criticism of planned interest-rate hikes by the Federal Reserve, saying in a Twitter post that tightening policy would diminish any U.S. advantage in trade and exacerbate losses from "BAD trade deals."
St. Louis Federal Reserve Bank President James Bullard said on Friday the Federal Reserve would remain unaffected by Trump`s comments on U.S. monetary policy.
When asked about the stock market possibly falling if the United States imposes duties on such a large amount of goods, Trump told CNBC: "If it does, it does. Look, I’m not doing this for politics."
Along with pressing Chinese leaders to shrink the deficit, Trump`s administration has accused China of engaging in unfair trade practices by forcing American investors to turn over technologies to Chinese firms.
White House economic adviser Larry Kudlow blamed Chinese President Xi Jinping for a lack of progress in bilateral trade talks, saying that lower-ranking officials want a deal. China has called the comments distorted and bogus.
On Friday, the Axios news website reported that Kudlow had said Trump was "not going to let go" of the trade issue.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)